NCDOT transportation board to hear proposal on mileage tax

RALEIGH, N.C. - North Carolina Department of Transportation board members will hear a presentation Wednesday on a proposal to tax people based on the number of miles they drive.

It's an idea that didn't sit well with Henry Martin.

"Everything is taxed. Most of the highway belongs to me anyway, all the taxes I done paid in these years," he said.

Angela Vogel-Daley with AAA Carolinas thinks a mileage tax will be complicated to implement and costly.

"You'd either need to track your car where you drove, where would those miles go towards?" she said. "Would they go toward state, local, or federal government? If you do an odometer reading it's simpler but it could still be complicated and more of the revenue may go to administrative costs rather than funding the roads."

Vogel-Daley thinks increasing the gas tax would be the simplest alternative to generate funds.

Currently North Carolina drivers pay one of the highest rates in the country at just over 37 cents per gallon at the pump.

NCDOT said the proposed mileage tax would generate around $500 million a year, charging drivers a half cent per mile.

It pales in comparison to the $2.8 billion in state and federal dollars currently generated from the gas tax.

As cars become more fuel-efficient and driving habits change, money generated from the gas tax will likely decrease by 2018.

"The gas tax is not the vehicle that is the right tool for the job going forward," NCDOT Chief Financial Officer Mark Foster said.

Foster said regardless of what the NCDOT decides, transportation is a huge part of the economy and ultimately the state will need several tools to fund it into the future.

Click here to look at the Enhancement Revenue Study the NCDOT board will hear about tomorrow that explores the impact of a proposed state mileage tax.